| NEWARK
– Attorney General Anne Milgram announced
today that the New Jersey Bureau of Securities
in the Division of Consumer Affairs has
obtained a judgment ordering Fred J. Miller
of Fort Lee, Eric Riedman of New York, and
their related Bergen County-based companies
to pay $3.6 million in restitution to investors
and $4.35 million in civil penalties to
the Bureau of Securities.
New
Jersey Superior Court Robert P. Contillo
also permanently enjoined and restrained
the defendants from selling, distributing
or engaging in any securities-related activity.
Following
a multi-day hearing last year, Judge Contillo
found that “the Attorney General clearly
and convincingly established a plethora
of securities laws violations” by
the defendants. From 1996 to 2003, defendants
Miller and Riedman created, operated, and
sold unregistered securities including promissory
notes offering a 12% return and equity interests
issued by their related entities from an
office in Englewood Cliffs, New Jersey.
Miller
and Riedman raised over $3.3 million from
approximately 160 investors through fraudulent
misrepresentations and omissions regarding,
among other things, the investments’
risks, poor operating history of the entities,
and the intended use of the investors’
funds. In addition, Judge Contillo found
that defendants Miller and Riedman misappropriated
and diverted investor funds for their own
use and to their personal entities that
served no legitimate investor or business
purpose.
“The exemplary efforts by the Bureau
investigators, and the Deputy Attorneys
General who tried this case, confirms our
ongoing commitment to protect the investing
public from investment scams, as well as
our fortitude to see cases to final judgment
in the courts to ensure that justice is
served,” said Bureau of Securities
Chief Vincent J. Oliva.
“Investors
should check with the Bureau of Securities
before investing their hard-earned dollars,
since both the securities being offered
for sale and the persons offering it must
be registered with the Bureau,” Oliva
added.
The
Bureau can be contacted toll-free within
New Jersey at 1-877-I-INVEST
(1-877-446-8378) or from
outside New Jersey at 973-504-3600.
The Bureau’s web site is located at
www.NJSecurities.gov
Deputy
Attorneys General Samuel Scott Cornish and
Christopher W. Gerold represented the state
in this matter, assisted by Supervising
Investigator Rudolph Bassman.
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